MercoPress. South Atlantic News Agency

Mrs. Kirchner in China to try and reopen the soy-oil market

A long overdue visit by Mrs. Kirchner to one of Argentina’s main trade partners

Argentine president Cristina Fernández de Kirchner arrived Sunday in Beijing with a delegation of 70 businessmen and an agenda concentrated on trade issues including one which is fundamental for Argentina, the resumption of soy-oil sales to China which have been banned for several months.

Commercial relations between the two countries in spite of the prosperous trade are not going through a good moment. China has repeatedly accused Argentina of growing trade protectionism towards Chinese products, which the Kirchner administration vehemently denies, and Beijing has retaliated virtually cancelling 2 billion USD annual purchases of soybean oil, alleging high percentages or chemical residues.

Argentina is the world’s leading producer of soybean oil and in 2009 China purchased 4.6 million tons equivalent to 70% of Argentina exports of the item. According to Cepal, the UN Economic Office for Latinamerica between the end of 2008 and January 2010, two thirds of the 33 ‘disloyal trade’ claims from Argentina before the World Trade Organization were targeted at China.

Besides early this year, President Cristina Kirchner cancelled an official trip to China as the ruling party was fighting the opposition on the use of Central Bank's foreign currency reserves to meet debt payments.

President Wu Jintao stated his disappointment for such an attitude to the point that the Argentine leader had to apologize for calling the visit off. The good gesture seemed to enhance the ties as China resumed buying oil and soy beans from Argentina for a few months.

However Chinese sources have said that talks to overcome the problem “are advancing” and there could be an announcement quite soon.

The Argentine “multi-sector” delegation of businessmen travelling with Mrs. Kirchner plus another fifty already in China include representatives from the pharmaceutical, chemical and petrochemical industries; biotechnology, bovine genetics, farm machinery, foodstuffs, wineries, ship yards, industrial logistics, transport, energy and services.

Mrs. Kirchner is scheduled to meet President Hu Jintao Tuesday, the following day Prime Minister Wen Jiabao before travelling to Shanghai for the Universal Expo where Argentina has a major pavilion.

Argentina and China are “strategic partners” and belong to the G20 group of industrialized and emerging powers trying to confront the global crisis and other issues of the international agenda.

Bilateral trade between China and Argentina has soared from 2.1 billion USD in 2000 to 13.3 billion in 2008, although there was a significant fall in 2009 because of the world crisis, according to the Argentine Foreign Affairs ministry. Next to Brazil and Chile, China is Argentina’s main trade partner, and could become the country’s main exports destination by 2015.

Chinese demand for Latinamerican commodities (food, energy, minerals) helped Latinamerica cope with the world crisis, and Brazil, Venezuela, Argentina and Peru (in that order) are considered ‘strategic’ for China according to Jiang Shixue an expert in Argentine issues at China’s Social Sciences Academy. China has also free trade agreements with Chile and Costa Rica.

Mrs Kirchner travelled with Foreign Relations Minister Héctor Timerman, Production Minister Débora Giorgi, Planning Minister Julio De Vido, and Agriculture Minister Julián Domínguez.

Secretary of Transportation Juan Pablo Schiavi who is already in Beijing was quoted by the Buenos Aires press saying that “everything was almost ready” and only a few details were yet to be discussed before President Cristina Kirchner and her Chinese counterpart could sign a series of bilateral trade agreements.

”We met with the board of directors of Citic International, whom we're working with to finish a series of arrangements that will provide the city of Buenos Aires with some extra subway cars”said Schiavi.

The Secretary also added that they were in talks to provide the Argentine railway system with new machinery, in an effort to recover certain branch lines in the interior.